ATOL is a financial protection scheme for holidaymakers. If an ATOL tour operator goes out of business, the ATOL scheme ensures customers contracted with the ATOL tour operator for an air package or a flight do not lose the money paid or are not stranded abroad.

It does this by carrying out checks on the tour operators, requiring them to take part in a financial guarantee scheme managed by the Air Travel Trust (ATT) which provides the funds to protect customers should a firm go out of business.